America Online on Thursday confirmed that it has begun hiring software engineers to fill its new offices in Bangalore, India.

As CNET News.com first reported, AOL began recruiting engineers in India last December in hopes of building an overseas presence where skilled, technical labor is cheaper than in the United States. AOL has already hired 12 engineers and will grow the office to about 50 over the next several months, a company spokesman said.

Bangalore, located in southern India, is considered one hot spot where many technology companies are building up their engineering and software development efforts. The city has witnessed its own economic boom, as more companies turn to its massive labor force to trim their own costs.

The outsourcing of skilled tech jobs overseas has become a controversial topic that has fostered business and political debate. The economic effects of offshore outsourcing remain varied, with some studies saying such outsourcing could help businesses, while others claim that it could hurt the national economy.

Offshore outsourcing has already taken a human toll in tech-heavy areas in the United States, causing alarm, as more jobs are exported.

Companies such as Hewlett-Packard, Oracle, Yahoo and Google have already opened, or plan to open, research offices in India.

AOL's entry into offshore labor last December came at an inopportune time. Weeks earlier, the company laid off 450 employees in its California offices, many of whom worked at the former headquarters of the Internet service provider's Netscape Communications subsidiary.

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